The Competitive Advantage of China Essay Example | Topics and Well Written Essays - 500 words

The Competitive Advantage of China - Essay ExampleThe country is ranked very low on considerations of favoritism in government decision making (Rank 43rd), ethical behavior (47th) Intellectual property cherishion (58th) and auditing and accounting standards (95th). These are artificial constraints and businesses have to be more progressive (manipulative) to succeed.The extent of sophistication of Chinas competitive advantage was quite poor, the country being ranked at 59th on this factor. Its competitiveness is based more on providing brazen labor and natural resources rather than unique and sophisticated products, technologies and processes.The countrys state owned enterprises and the banking sector are still in deep trouble, government intervention to protect these lead to skewed decisions. Levels of financial intermediation are low and the state has had to intervene from time to time to mitigate the adverse effects of a large, non-performing loanword portfolio. Added to this is the artificially fixed exchange rate that has remained unchanged at 8.28 Rmb/US$ in the period under review. Floating of the Yuan to see its market operate level shall have major repercussions on the economy as it likely to appreciate considerably making Chinese products more expensive and allow contest from other countries.In terms of consumer sophistication China ranked 42nd and only 64th in terms of the extent to which its domestic consumers actively de